The Prospective Impact on Public Companies of the Financial Regulatory Reform Bills: A Legislative Update
On May 20, 2010, the U.S. Senate passed a comprehensive set of financial regulatory reforms that, if enacted, will represent the most sweeping set of changes to the U.S. financial regulatory system since the Great Depression. The reforms, which are set forth in a bill of more than 1,500 pages called the Restoring American Financial Stability Act of 2010 (S. 3217, or the “Senate Bill”), come after nearly a year of Congressional hearings and months of stop-and-start legislative negotiations. The Senate Bill tracks many of the themes contained in the Wall Street Reform and Consumer Protection Act of 2009 (H.R. 4173, or the “House Bill”) that was passed by the U.S. House of Representatives on December 11, 2009. Both bills mandate specific executive compensation and corporate governance practices at U.S. public companies generally.